Higher educational institutions play a pivotal role in economic development. Accumulation of human capital stimulates innovation and entrepreneurship which lead to increase in productivity. Countries with higher human capital tend to enjoy sustainable economic growth in the long run. Universities should not only get involved with knowledge distribution but also involved with research and innovation (R&I) which is the heart of higher educational institutions.
Sustainable funding culture is crucial for universities to maximise their contribution to economic growth and long-term national capacity building. However, public universities in Bangladesh rely too much on government funding for smooth functioning and allocate too little to invest in R&I. The allocation of fund for R&I in public universities indicates the dire condition in this prime sector.
For example, Dhaka University allocated only 1.09 per cent of total Tk 8.69 billion in this year's budget while the figure is 1.24 per cent of Tk 3.40 billion total budget for Chittagong University. Interestingly, according to newspaper reports, a total of Tk 66.75 million has been allocated in the main budget for research purposes at 46 public universities in the 2020-21 fiscal year which was Tk.64.58 million in the last fiscal year.
At the same time, private universities are struggling to maintain quality and educational standards amid a deteriorating financial condition. Only a handful of universities give priority to R&I while others don't seem to pay much attention to this important area. Consequently, we find that, 64 private universities spent Tk 93.37 million in research in 2016 which was Tk 78.94 million in 2017 by 73 private universities as reported by UGC.
Surprisingly, some first generation private universities couldn't move to their permanent campus even after 20 years. Most of the universities are heavily dependent on tuition fees from students. In the recent past, we have seen many private universities to be'on sale'with the drastic fall in number of students. Poor management, fund diversion, no alternative source of income, and growing competition have aggravated the situation.
Bangladesh, an emerging economy, faces a number of constraints in the development of higher education sector and resource constraints and competing priorities are few of them. For example, government has set aside Tk 857.62 billion for education sector for this fiscal year which represents 15.1 per cent of the total budget. International norms show that the education sector usually receives 5-6 per cent of the GDP or 20 per cent of the national budget. For example, universities in OECD countries are mostly public-funded where governments provide around 70 per cent of funds required. Moreover, private universities receive up to 5 per cent public funding in OECD countries. Still Bangladesh's expenditure on education is one of the lowest in the world, both as a percentage of GDP and as a percentage of the national budget.
It is evident that public fund alone is not sufficient for the development of higher education in Bangladesh. Most importantly, we have seen the financial vulnerability of private higher educational institutions during Covid-19 pandemic. Dropouts have increased significantly as students and parents become jobless or face serious economic hardship. Public and private universities simply don't have sufficient fund to provide generous support in form of scholarships and stipends in this crisis period. It is high time wethought seriously about the financial model of private and public higher educational institutions. Public universities in developed and emerging economies don't rely solely on government moneyas they have alternative sources of funding. For example, government funding for public universities in Malaysia has declined significantly in the recent past which has encouraged them to look for alternative sources of funding including waqf fund.
Waqf, in plural 'awqaf', is an Arabic term meaning endowment derived from the root verb Waqafa. Waqf is a voluntary donation: a running charity. Waqf literally means tying up of an asset (Real estate, cash, etc.,) for some specific Shari'ah compliant objectives in such a way that i) the principle remains intact and ii) only its income/benefit is spent on the named objectives.
Waqf has four major components – the founder, the beneficiaries, the trustees, and the endowed asset or property. Waqf can be generally classified into three types: public waqf, family waqf, and mixed waqf.Waqf can be also general, specific or mixed.
Waqf has played very significant role in various aspects of life including education and social development. Quba mosque and Nabawi mosque were the first waqf institutions in Islamic history. Most interestingly, waqf institutions flourished during the Ottoman and Mamluk period. Higher educational institutes can be established based on waqf concept. First Waqf University,'Al-Azhar' of Egypt, was established in 975 AD and University of Al-Qurawwin in Fez, Morocco in 1200 AD. The concept of waqf was even adopted by leading western universities like Oxford and Cambridge during the origins of English trusts.
Waqf had played a significant role in improving socio-economic conditions of Muslim countries before they were colonised by the European settlers. In sub-continent, waqf administrations have become largely inactive during the two hundred years of colonial period. The contribution of Haji Mohammad Mohsin endowment in education is still visible in many parts of the Bengal.
The concept of Waqf University has got traction across the Muslim world. In Turkey, there are about 76 waqf universities today and the numbercontinues to increase. Its largestcity, Istanbul, has 38 universities.Some of them likeSabanci University and Koç University enjoy excellent reputation and are considered to be among the top universities in the country.
As for Malaysia, there are some universities that have alreadyestablished their own 'waqf-based university concept' in their higher educational operations; these involve welfare services and academic or professional programmesand activities. These universities are the UPM (Putra University of Malaysia), the UKM(National University of Malaysia), the IIUM (International Islamic University of Malaysia), the IUM (Islamic University of Malaysia).
There are various Waqf university models successfully adopted in Malaysiaand Turkey. One of the pragmatic models is to transform conventional methods of financing universitiesby creating corporate waqf universities. Government and private corporations can come forward to establish waqf funded universities.Hamdard, a successful corporate waqf in Bangladesh, has already established the first Waqf University in Bangladesh. Other innovative Waqf development tools like cash Waqf, alumni funded waqf, and fintech based crowd funding Waqfcan be integrated in Waqf universitymodel. Considering the regulatory framework of Bangladesh, ahybrid waqf university model could be established which would work well to create a revolving investment mechanism like 'endowment fund' in the West. The assets pooled under Waqf structurewould be invested to generate a stream of revenues to support universities in providing scholarships, professorships, researchgrants and other R&I activities.
In conclusion, we can say that government alone cannot ensure sustainable source of financing for higher education and it is even more challenging for a developing country like Bangladesh where many competing priorities exist.The revival of waqf can be a real game changer for higher education financing in Bangladesh. However, there are some challenges. Registration of waqf can be complicated and cumbersome. Regulatory reform is required to decentralise the waqf management and mutawalli/trustee should have greater autonomy to invest and develop waqf fund. Waqf accounting is an important issue too as reports need to be approved by the trustee and eternal auditor.If we can revive the forgotten legacy of waqf and integrate Waqf fund in every public and private university, we will be able to develop an inclusive, innovative and sustainable higher education system in Bangladesh.
The author is a columnist, researcher and currently working as an Assistant Professor of School of Business at the University of Creative Technology Chittagong. He can be reached by email email@example.com.